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Microsoft Ads Are Everywhere, But They're Not Selling Windows

Marketing Finds Itself Up Against Bigger Industry Trend

No matter where you go, there are the Windows ads -- on train cars, in choreographed TV spots and on T-shirts worn by street -marketing teams. Yet despite the massive campaign -- $1.5 billion by some estimates -- early Windows 8 sales have disappointed in an increasingly fragmented computing market.

Sales of Windows devices were down 21% in the four weeks after Windows 8 launched on Oct. 26, compared with the same period last year, according to research firm NPD Group.

Are the ads at fault?

Not only are customers buying fewer Windows devices, they are particularly uninterested in Microsoft's flashy new operating system. Devices that use Windows 8 accounted for just more than half (58%) of all Windows units sold in the four weeks after it launched, NPD said. In the four weeks after Windows 7 was released, it accounted for 83% of all device sales.

So is the advertising at fault?

"[Microsoft] didn't make the market any better," said Stephen Baker, NPD's VP-industry analysis, "I don't think they could do advertising well enough to change the direction of where the PC market is going this year. I don't think there's enough advertising money in the world [to do that ]."

The computing world, as Mr. Baker sees it, is one in which consumers are favoring simpler devices to complete simple tasks at a lower cost. Windows 8 and its devices offer a more robust experience with corresponding prices.

The ads are helping boost Windows' brand perception. In early November, it reached its highest point since the introduction of Windows 7 in October 2009, according to research firm YouGov's Buzz Score. That's a good start, but the software giant will have to continue to spend to keep its perception high and brand top-of -mind, because software purchasing often has a long lead cycle, built around when consumers or businesses need to upgrade, not necessarily when new operating systems come out.

Incidentally, Microsoft's best brand-perception marks were coming from tablet owners -- possibly because a big part of the Windows 8 push has been around touch navigation and a mobile-first design.

However, sales of Microsoft's tablet, called Surface, have been weak. Brokerage firm Detwiler Fenton last week estimated that Microsoft is likely to sell just 500,000 to 600,000 Surface tablets this quarter; its previous expectation was 1 million to 2 million.

That may have less to do with advertising than with a limited retail strategy, as Microsoft has restricted Surface sales to its own brand stores.

Microsoft won't comment on which agencies are behind its recent efforts, but it is known that CP&B has done some work on Windows 8. As for Surface, the marketer said only that "we worked with a small team [representing] a wide range of creative resources."

One of of five Windows 8 commercials tested by research firm Advertising Benchmark Index (ABX) is performing above the average for the category, while two snagged average scores. Meanwhile, research on 11 TV spots for tablets released from September to November revealed that Microsoft's Surface spots score just a hair above average at 101. Samsung had four spots that registered score greater than 110, while Apple had two.